Crude Oil Futures Higher as Inventories Slide

The U.S. Energy Information Administration (EIA) released its weekly petroleum status report this morning. U.S. commercial crude inventories dropped by 9.9 million barrels last week, maintaining a total U.S. commercial crude inventory to 373.9 million barrels, still above the upper limit of the five-year range for this time of the year.

Total gasoline inventories decreased by 1.7 million barrels last week and are near the upper limit of the five-year average range. Total motor gasoline supplied (the EIA’s measure of consumption) averaged more than 9.1 million barrels a day over the past four weeks — equal to the level in the same period a year ago.

Distillate inventories rose by 3 million barrels last week and remain near the lower limit of the average range. Distillate product supplied averaged 4.1 million barrels a day over the past four weeks, up about 12.3% when compared with the same period last year. Distillate production totaled 5 million barrels a day last week, up about 200,000 barrels a day compared with the prior week.

The American Petroleum Institute last night reported that crude inventories fell by 9 million barrels last week, together with a drop of 3.5 million barrels in gasoline supplies and a rise of 2.8 million barrels in distillate supplies. Platts estimated a drop of 3.8 million barrels in crude inventories, a rise of 1.2 million barrels in gasoline inventories and a rise of 1.4 million barrels in distillate inventories.

Crude prices were up about 1.6% before the EIA report at around $105 a barrel, and it climbed further to around $105.55 shortly after the report was released.

For the past week, crude imports averaged more than 7.5 million barrels a day, up about 118,000 barrels a day from the previous week. Refineries were running at 92.4% of capacity, with daily input of 16.1 million barrels a day, about flat with the previous week.

This marks the second straight week of a significant drop in crude supplies. But inventories remain very high and gasoline supply is plentiful. According to the AAA Fuel Gauge report, a gallon of regular gasoline costs about $3.50 today compared with about $3.48 a week ago. Last month the price was $3.64 a gallon and one year ago the price of a gallon of regular gasoline was $3.38.

The United States Oil ETF (NYSEMKT: USO) is up 1.4%, at $37.27 in a 52-week range of $30.79 to $37.35. The 52-week high was set earlier today.

The United States Gasoline ETF (NYSEMKT: UGA) is up 1.4%, at $59.41, in a 52-week range of $50.47 to $65.86.

The United States Brent Oil ETF (NYSEMKT: BNO) is up 0.4%, at $82.25 in a 52-week range of $69.85 to $88.71.